The collapse of FTX is being viewed as a cautionary tale and a precursor for more prudent regulation by public and private sector players in the United Kingdom.
The deputy governor highlighted increased interest in cryptocurrency markets from financial institutions and retail users as a driving force behind the need for greater regulatory oversight in the country: “We had banks and investment funds and others who wanted to invest in it and I think we should think about regulation before it becomes integrated with the financial system and before it becomes a systemic problem.”
“We saw things like clients' money appears to have gone missing, conflicts of interest between different operations, transparency, audit and accounting."
Drawing parallels to the gambling sector in the U.K., Cunliffe said that investors should have access to a regulated environment that prevents losing access to funds as was the case in the collapse of FTX.
The collapse of FTX demonstrates the importance of ‘prudent regulation’ according to Mechigian.
2022 has been a tumultuous year for politics in the U.K., with three separate Prime Ministers taking office in the space of a few months.
Source: Cointelegraph